Retail-based exchange traded funds have found themselves in the hole on Tuesday after shares of Walmart ( NYSE: WMT ) declined by nearly 10% following the release of a disappointing forecast.
Two funds in particular have dipped on the news. The VanEck Retail ETF ( NASDAQ: RTH ) and the SPDR S&P Retail ETF ( NYSEARCA: XRT ) have suffered declines, with RTH down 3.3% and XRT off 4% .
VanEck’s RTH holds the largest portfolio weighting towards WMT compared to any other exchange traded fund on the market with a 7.67% stake in the fund. This represents the fund's fourth largest position which equates to a rough market share value of $10.92M.
XRT on the other hand has a 1.16% weighting in Walmart, placing the stock as the funds nineteenth most prominent position, with a market share value of approximately $4.03M.
Tuesday’s slide added to weakness RTH and XRT have seen so far this year. In 2022, RTH finds itself -17.8% , while XRT has cratered 33.9% . Bigger picture, Walmart is also lower in 2022, falling by 16.1% .
Additionally, Walmart’s drop has rattled the entire retail sector as funds not tied to the stock have also sunk into the red. Two examples are the ProShares Online Retail ETF ( ONLN ) and Amplify Online Retail ETF ( IBUY ) which trade lower by 3.6% and 4.3% , respectively.
Walmart is down by 8.1% after the multinational retail giant cut its guidance amid persistent inflation and inventory matters. Moreover, WMT now expects operating income for the second-quarter and full-year to decline 13% to 14% and 11% to 13%, respectively.
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Walmart selloff has rattled retail ETFs